BANK of Namibia deputy governor Ebson Uanguta this afternoon said commercial banks should act in the nation's interest, and can grant distressed borrowers a loan break period of between six and 24 months if their internal policies allow that.
Uanguta said this in a statement issued in response to the impact the coronavirus and its far-reaching economic fallout is expected to have on the banking sector.
The deputy governor said a debt repayment break, if the banks were to give it, should be applied in a transparent, fair and equitable manner, and based on an individual assessment of financial difficulties experienced by borrowers.
Policy relief measures announced by the central bank loosen limits on debt and include liquidity relief for the banks, a reduction in the capital conservation buffer, as well as a postponement of the implementation of limits on the amount any single borrower may owe a bank and of limits on the number of loans banks may give in a certain sector (concentration risk limit).
Uanguta said the measures would enable banking institutions to play their role in supporting the economy during challenging circumstances by providing flexibility for banks to respond swiftly to the needs of their customers.
"However, in implementing these measures, banking institutions should act in the national interest and be guided by their internal policies and processes," he said.